Prime Minister Manmohan Singh on Tuesday cautioned industry against short term gains and asked it help fight inflation by absorbing increase in input costs and give relief to consumers by passing duty cuts.
"Let me be upfront and say that the industry and trade must eschew the temptation of seeking short term gains and should cooperate with the government to ensure long term stability of the growth process," Singh told captains on industry at the annual meeting of apex association CII.
Singh's appeal to industry for cooperation comes hours before the annual monetary policy by Reserve Bank of India in the midst of inflation touching a three year high of over seven per cent right from the beginning of the current fiscal.
On its part the government has taken several steps to reverse the recent spurt in prices, Singh said and reminded the industry of its "socital obligation" in controlling inflation.
In a veiled warning against cartelisation, Singh said: "Leaders of industry, particularly in sectors characterised by significant market power in the hands of a few producers have a socital obligation to assist the government in moderating inflationary expectations."
Detailing the factors responsible for inflationary pressures, particularly due to surging global oil and food prices, he said industry should absorb to the extent possible rise in input costs. "Industry must also pass on benefits of tax and duty cuts to consumers.
"A measure of soberity in corporate lifestyle and compensation can also help cut costs and maintaining the price level," Singh, whose call to the steel industry last week had resulted in major players announcing to hold the price line for three months, said.